SINGAPORE (March 10): Palm oil may break a support at 2,820 ringgit per tonne and fall more to the next support at 2,783 ringgit, as suggested by its wave pattern and a Fibonacci retracement analysis.

These supports are identified respectively as the 23.6% and the 14.6% Fibonacci retracements of the downtrend from the Feb 10 high of 3,135 ringgit to the Feb 28 low of 2,723 ringgit.

The failure of the contract to break the resistance at 2,880 ringgit signals an extension of the drop from the March 6 high of 2,898 ringgit. The drop has been driven by a wave b, the second wave of a presumed three-wave cycle from 2,723 ringgit.

A break above 2,880 ringgit could signal the continuation of the uptrend towards 2,929 ringgit. - by Wang Tao, Reuters

(Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own. No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.)

(US$1 = 4.4430 ringgit)